Annual Procurement Report | Queen Margaret University, Edinburgh

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��Ⱥ�� Annual Procurement Report

��Ⱥ�� Annual Procurement Report

Executive Summary

The Procurement Reform (Scotland) Act 2014 (PRA) required any public organisation which has an estimated annual regulated¹ spend of £5 million or more to develop a procurement strategy and then review it annually. This requirement took effect from 31 December 2016. Organisations (including HE and FE institutions) required to develop and publish a procurement strategy were also required to publish an Annual Procurement Report (APR), reflecting on the relevant reporting period of the procurement strategy.

This report covers the period of 01 August 2023 to 31 July 2024 and addresses performance and achievements in delivering the Queen Margaret University’s organisational procurement strategy².

The development of the procurement strategy was the outcome of consultation and discussion with internal and external stakeholders who have an interest in the institutional approach to procurement and its impact. Stakeholder engagement will also feature in the annual assessments of the achievement of regulatory compliance, strategic objectives of the institution, value for money [defined as the best balance of cost, quality and sustainability] and delivery against the institution’s broader aims and objectives, in line with Scotland's National Outcomes. This process of review and reporting will inform any adjustments to the procurement strategy deemed necessary to secure future performance improvements and to respond to the economic, political and financial influences to which the institution may need to adjust.

Queen Margaret University has analysed third party expenditure and has identified that over the period covered by this report the following expenditure has occurred:

Regulated procurements [goods and services worth more than £177,897; works worth more than £4,447,447] amounted to £2,209,363.52. There were 3 such procurements completed.
Lower value regulated procurements [goods and services worth more than
£50,000, works worth more than £2 million] amounted to £917,929.17. There were 3 such procurements completed.

More detailed information on the regulated procurements, sorted into procurement categories, is provided in Sections 1 and 2 and in Appendix A of this report.

Queen Margaret University has over 767 active suppliers with whom the University did business in the reporting period), and the total procurement expenditure was £10,680,687.60 - £3,641,248.81 of regulated expenditure (recorded on the Contracts Register) and £7,039,438.79 on non-regulated.

The University has been optimising use of national, sectoral, local or regional C1 collaborative contracts and frameworks. As well as bringing leverage-based savings, the burdens of risk, contract and supplier management are shared and the number of resource-intensive formal local tenders that need to take place is reduced significantly. 21% of the University spend went through collaborative agreements.

41.34% was spent with SMEs who constitute 87% of the total of active suppliers. 6 SMEs featured in the award of regulated procurements.

This report comprises six sections which address mandatory reporting requirements.

Section 1: Summary of Regulated Procurements completed
Section 2: Review of Regulated Procurement Compliance
Section 3: Community Benefit Summary
Section 4: Supported Businesses Summary
Section 5: Future Regulated Procurements Summary
Section 6: Optional Considerations

Date: 09-Dec-24

Report Approved & Signed By: Christopher Reilly

Position: Interim Finance Director

_{1 ‘Regulated’ procurements are those with an estimated value equal to or greater than £50k (≥ £12,500 per annum over a four-year contract period excluding VAT) for goods & services (or £2,000,000 excluding VAT for a public works contract).}

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Section 1: Summary of Regulated Procurements completed

��Ⱥ�� strongly believes in conducting its procurements in an open and inclusive manner with procurement objectives aligned to the University’s Strategic Plan.

The details of regulated procurements completed are set out in a list at the end of this report with details summarised in Appendix A. That information, coupled with the publication of the institutional and the systematic use of Public Contracts Scotland and Quick Quotes, provides complete visibility of the University’s procurement activity over the reporting period.

In Appendix A, information is set out to show lower value regulated procurements completed and EU regulated procurements completed. These are separated into contract categories and distinguish collaborative contracts from institutional ones. For each completed regulated procurement the information provided shows:

the date of award
the start dates
the category subject matter
the name of the supplier
estimated value of the contract – total over contract period
collaborative or institution owned
the end date provided for in the contract or a description of the circumstances in which the contract will end.
SME / supported business?

Section 2: Review of Regulated Procurement Compliance

Where appropriate, Queen Margaret University has made use of collaborative contracts to deliver improved contract terms, supported contract and supplier management, sustainable procurement outcomes and value for money (the best balance of cost, quality and sustainability).

In making its regulated procurements every care has been taken to ensure that the University awards the business to suppliers who are capable, reliable and who can demonstrate that they meet high ethical standards and values in the conduct of their business.

In the period covered by this report the University has conducted all its regulated procurements in compliance with EU Treaty Principles of equal treatment, non-discrimination, transparency, proportionality and mutual recognition.

Successful delivery against the procurement strategy objectives is part of a customer valued, continual improvement process (CIP) that seeks incremental improvements to process and outcomes over time.

The PCIP assessment was conducted in April 2022 by APUC, and the institutional score fell into the Silver band. The intention now is to improve upon this score and maintain the Silver band rating or move into the Gold band in time for the next assessment.

Procurement aims and focus	Annual Report Commentary on strategy delivery/compliance
Support Academic and Professional Services Departments to enhance the learning experience, for the many and diverse needs of stakeholders, by providing innovative solutions for their procurement decisions.	Optimal procurement strategies are developed and agreed through consultation with key stakeholders, end users and suppliers. This intelligence gathering approach is also used to deliver innovation, to improve skills and competencies in securing the most appropriate procurement routes to market that yield best value outcomes consistent with the guidelines set out in the Procurement activities follow the guidelines set out in the Procurement Journey. This helps to manage the expectations of stakeholders, customers and suppliers alike and facilitates best practice and consistency with what other organisations do across the Scottish public sector. For every procurement over £4m, the institution will consider how it can improve the economic, social or environmental wellbeing of its area through inclusion of community benefit clauses. Where possible and proportionate, such clauses may be included in procurements below £4m. Care is taken to ensure that procurement operations chime in with and support institutional strategic objectives.
To sustain and further develop partnerships within the sector, with other publicly funded bodies, with professional bodies and appropriately with supply markets that will yield intelligence, innovation and deliver value to users of procurement services.	The engagement with internal and external stakeholders and suppliers provides valuable feedback which informs the University of possible necessary adjustments and improvements to strategy and process. For each procurement, the institution considers the community affected by the resultant contract and ensures that any affected organisations/persons are consulted (e.g. impact on service for students, or a local contract that could be combined with other similar institutions’ needs). Such consultation will always be on a scale and approach relevant to the procurement in question. The institution actively engages with other bodies through HE and FE specific events, Scottish public-sector events and wider UK HE events.
To promote the delivery of value for money through good procurement practice and optimal use of procurement collaboration opportunities.	The best balance of cost, quality and sustainability is consistently used to assess value for money delivered and to identify sensible aggregation opportunities through collaborative contracting. Queen Margaret University sorts regulated procurements into procurement categories. How these goods, services and works are bought – joint purchasing, use of local, regional and national framework agreements, consolidated contracting – is subject to annual review with APUC and, through user consultation, optimal category strategies are agreed, sensible aggregation opportunities are exploited, category and commodity strategies are developed, recorded, signed off and processed.
Develop management information to measure and improve procurement and supplier performance, assisting key stakeholder areas in meeting their requirements for best value goods and services.	Internal governance procedures, policies, tools such as e-enabled workflow enhancements are introduced to effect improvements to procurement process and efficiency. Expenditure segmentation analysis and data located on the Hub, Hunter (including Contracts Registers) and Procurement Data Dashboard. Where relevant, use is made of appropriate standards and labels in procurements to take account of fair and ethical trading considerations with due consideration given to equivalent tender offerings from suppliers; use is made of PCS and PCS-T to publish procurement opportunities; and appropriate use is made of lotting, output-based specifications and clear evaluation criteria to ensure that procurements are accessible to as many bidders (including SMEs) as possible.
To embed sound ethical, social and environmental policies within the Institution’s procurement function and to comply with relevant Scottish, UK and EC legislation in performance of the sustainable procurement duty.	Procedures are in place to ensure that consideration of environmental, social and economic issues and benefits is made, where appropriate, on a contract-by-contract basis during the planning stage utilising tools including Prioritisation, Flexible Framework, APUC’s Supply Chain Code of Conduct, and Supply Chain Management Programme (section 2 questions = Sustain) Procedures are also in place to ensure that regulated procurements are only awarded to businesses that are capable, reliable and, where relevant, meet high ethical standards and values in the conduct of their business. Queen Margaret University is committed to contracting only with suppliers that comply with all appropriate and relevant legislation. Where appropriate, and on a contract-by-contract basis, the institution will assess the legislation applicable to a procurement and take steps to ensure bidders comply with it e.g. Health and Safety, Late Payment legislation. Where relevant and proportionate the Living Wage and fair work practices of suppliers are promoted in tender documentation. The University is a Living Wage employer. The Institution complies with its duties under the Modern Slavery Act.

Queen Margaret University has procurement process and sign off arrangements that are consistent with the guidelines set out in the Procurement Journey and that have met the objectives and obligations set out immediately above.

Section 3: Community Benefit Summary

For every procurement over £4m, Queen Margaret University will consider how it can improve the economic, social or environmental wellbeing of its area through inclusion of community benefit clauses, to assist with achieving sustainability in contracts activity, including targeted recruitment and training, small business and social enterprise development and community engagement. Where possible, relevant and proportionate, and where they are considered not to have a negative impact on the delivery of value for money, such clauses may be included in regulated procurements valued at below £4m.

The general University policy on identifying community benefit requirements is to conduct risk and opportunities assessments through stakeholder consultation and engagement – on a case- by-case basis the question is asked, ‘could a community benefit clause be usefully included’? Where relevant and proportionate to the subject matter of the procurement, the requirement is then built into the procurement specification and into the eventual conditions of contract performance.

Where applicable, as part of the tendering process, suppliers are invited to describe their approach to delivering community benefits or achieving social value through a contract. Relevant community benefits are cited, such as:

providing ‘upskilling’ opportunities (e.g. Toolbox talks) with students and staff,
offering advice and assistance on the best practice methodology,
employment, student work experience and vocational training opportunities,
apprenticeships,
local subcontractor opportunities available to SMEs, 3rd sector and supported businesses,
direct involvement in community-based schemes or programmes,
equality and diversity initiatives,
supply-chain development activity,
educational support initiatives,
to minimise negative environmental impacts, for example impacts associated with vehicle movements and/or associated emissions and impacts on protected areas, buildings or sites.

Tenderers are invited to describe how such benefits will be delivered through the contract and promoted to contract users. Where community benefits are included in a procurement (at or above the £4 million threshold), the award notice would include a statement of the benefits that are expected to be derived from the contract.

Queen Margaret University has awarded 6 regulated procurement contracts over the reporting period. For this current period, none of these was over £4 million in value.

Section 4: Supported Businesses Summary

Higher value procurements, regulated procurements (between £50k and OJEU threshold and those equal to and above the OJEU thresholds) are conducted in line with Routes 2 and 3 respectively of the Procurement Journey. Both Routes 2 and 3 mandate the use of the European Single Procurement Document (ESPD (Scotland)). The ESPD covers exclusion, selection and award criteria and includes questions relating to companies self-certifying themselves in terms of size (micro, small or medium), or whether they are supported businesses.

The institution reviews each procurement to determine whether it could be fulfilled by a Supported Business, whilst remaining compliant with EU and Scottish Procurement Legislation and ensuring value for money for the institution (using the only Supported Business register currently available and published by Ready for Business).

The University aims to increase its contract uptake through the Supported Business framework agreement. In tandem, the University will research opportunities for awarding contracts to third sector bodies including social enterprises.

Section 5: Future Regulated Procurements Summary

Queen Margaret University is keen to encourage competition by promoting optimal participation in its procurement process and achieve better value for money in its procurements. One method of achieving this is to give notice to suppliers of tendering opportunities that are expected to commence over the next two financial years after the period covered by this report.

In preparing this forward projection of anticipated regulated procurements, it is difficult to be precise about providing details of actual requirements. Over a forecast period of two years it is very probable that circumstances and priorities will change so the list of projected individual regulated procurement exercises outlined in Appendix D should be viewed with this caveat in mind.

The information provided in Appendix D - list of Future Regulated Procurements covers:

the subject matter of the anticipated regulated procurement
whether it is a new, extended or re-let procurement
the expected contract notice publication date
expected award date
expected start and end date
the estimated value of the contract.
contract category: call off from framework, C – local contract or C1 – local collaboration

Section 6: Optional Considerations

The University is working with its service providers for catering and integrated facilities management to gather evidence of progress towards community benefits and fair work practices. Both suppliers are engaged in this process and are using guidance and tools provided by the Scottish Government to monitor progress in these areas.

The University has recently started to use and global business sustainability ratings as part of its contract management process. The University is working with APUC to prioritise suppliers in terms of contract value and risk in order to determine which tool should be employed. The University will assess suppliers via the lighter touch SCM tool or the more in-depth and externally assessed Ecovadis tool depending on the results.

Appendices

Appendix A - List of Regulated Procurements (Compliant and Non-Compliant) Completed in the Reporting Period 8/22 – 7/23

Appendix B - List of Regulated Procurements with Community Benefit Requirements Fulfilled (Not Applicable)

Appendix C - List of Regulated Procurements placed with Supported Businesses (Not Applicable)

Appendix D - List of Regulated Procurements planned to commence in next two F/Ys 23/24 & 24/25